International Seafoods of Alaska, Inc. v. Bissonette

146 P.3d 561, 2006 Alas. LEXIS 127, 2006 WL 2522393
Alaska Supreme Court·Decided September 1, 2006·No. S-11568·Published·Cited by 7 cases

Opinion

OPINION

CARPENETI, Justice.

I. BACKGROUND

A group of commercial salmon fishers from the Egegik district of Bristol Bay sued International Seafoods of Alaska (ISA) alleging that ISA breached its contract by paying a lower price at the end of the season than it had earlier promised. A jury agreed. Because the superior court properly certified the group of fishers as a class, correctly rejected ISA's proposal to use a separate verdict form for each class member, correctly instructed the jury, did not abuse its discretion in imposing limited sanctions on absent class members who did not respond to discovery, and acted within its discretion in augmenting the plaintiffs' attorney's fees under Rule 82, we affirm the superior court in all respects.

*563 II. FACTS AND PROCEEDINGS

A. Facts

Appellees are set net salmon fishers in the Egegik District of Bristol Bay who sold red (sockeye) salmon to ISA during the 2000 fishing season. The fishers allege ISA underpaid them for the delivered salmon. They maintain that ISA agreed to pay the "competitive Bay price" for red salmon, which at the time was between $0.65 and $0.70 per pound. ISA argues that it only agreed to pay the posted price of $0.50 per pound.

Buyers in Bristol Bay traditionally pay a posted or grounds price at the time the salmon is delivered. Later in the season, big buyers such as Trident, Peter Pan, or Icicle often set a higher price, and smaller buyers match that price. This is called "matching the majors" or meeting the "bay price." Buyers will then pay the fishers a "retro" bonus at the end of the year to make up the difference between the posted price and the bay price. This practice of paying a base price during the season and then paying a retro later is well accepted in Bristol Bay. An employee of ISA acknowledged this practice, testifying, "Well, when we paid retros, we paid them under the premise that we had to keep our fishermen. If we didn't pay what our competition was paying, then our fishermen would go away. And that's that's why we paid-that's why we matched other people's prices even if we lost money." The employee further elaborated regarding the fishing season in question:

Well, in this case, in 2000, everyone knew, because Trident ... came out in the middle of the season and said that they were going to pay 65 cents for the fish. So once Trident, who's the leader in Bristol Bay, comes out and says that, then it's-you know, the discussion's over, really, what people are going to pay. Everybody pretty much knows what they're going to get.

The fishers and buyers learn about increases in the posted price and the anticipated bay price from sources such as the National Fisherman, the Alaska Fisherman's Journal, Department of Fish and Game publications, and locally posted notices. Since 1987 ISA always paid the bay price or close to it. In the several years leading up to 2000, ISA matched the majors. When ISA's posted price was lower than the competitive bay price, ISA paid retros.

The two main fish buyers on Egegik beach in the years leading up to 2000 were ISA and Big Creek. Big Creek left the Egegik district in 1999 and leased its dock and related facilities to ISA. The fishers expressed concern that ISA would have a monopoly on the Egegik beach for the 2000 season, and that as a result ISA would not pay competitive prices for the salmon.

On May 1, 2000-before the start of the fishing season-ISA sent a letter to all Ege-gik fishers. The letter stated in part:

Dear Egegik Fishermen:
Greetings again from everyone here at I.S.A. The 2000 salmon season is ready to kickoff and we wanted to let all of you know that we have acquired the Big Creek Fisheries plant and property. We just wanted to speak to some of the concerns that fishermen have expressed to us. Here they are:
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3. Will LS.A. continue to be competitive with the price?
Yes. We have always done things according to our own costs and sales and we will continue to do that. We know that to keep your business we must be competitive with our price and by acquiring Big Creek we are making a financial commitment to do business on the beach for years to come.

The fishers interpreted this letter to mean that ISA would match the majors and pay the competitive bay price for salmon that season. The fishers focused on the word "competitive," which they contend has a specific meaning in Bristol Bay. According to the fishers, being competitive in Bristol Bay means "paying bay price and [being] competitive with every other fish buyer in the area and the district." Based on common practice in Bristol Bay, ISA's previous course of dealing, and ISA's explicit promise to be "competitive with our price," the fishers argued that they had a contract to provide salmon in exchange for the bay price and that ISA *564 breached this contract. The fishers also rely on a meeting between fishers and ISA representatives in the summer of 2000, during which ISA allegedly promised to "pay the bay price."

ISA contends on appeal that it made no such promise. ISA looks to the language in the letter regarding its "own costs and sales." The cannery argues on appeal:

ISA's purpose in utilizing the language relating to its own costs and sales was to make clear that the amount to be paid, including any retro payment that might be made at the end of the year, would have to depend upon its own market conditions, and not those of a competitor such as the "major" buyers in Bristol Bay.

(Emphasis in original.)

ISA claims it needed to base its payments on its own profit margin and not that of its competitors. Due to a variety of factors, ISA lost money on the Egegik operation in 2000. Consequently, it determined that it could not pay the retro above the posted price.

B. Proceedings

Six Egegik fishers filed a class action complaint against ISA on February 28, 2002. The fishers argued that they relied on ISA's representations that the cannery would pay fishers the competitive bay price, and that ISA subsequently failed to pay that price. They requested monetary damages for the difference between the price paid and the bay price. (They also requested damages for "plugging," which refers to a cannery's inability to buy all the fish provided by the fishers, although they later dropped that claim.) They sought pre- and post-judgment interest, costs, and attorney's fees.

In August 2002 plaintiffs moved to certify the suit as a class action. They defined the class as "all fishers in the Egegik District who sold fish to ISA during the 2000 fishing season." Plaintiffs contended that they met the prerequisites for class certification under Civil Rule 23, including numerosity, commonality, typicality, and adequacy of representation.

ISA strongly opposed the motion for class certification. It argued that plaintiffs could not meet the numerosity requirement because the class was small and its members easily identifiable.

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International Seafoods of Alaska, Inc. v. Bissonette, 146 P.3d 561, 2006 Alas. LEXIS 127, 2006 WL 2522393 (Ala. 2006).

146 P.3d 561 (International Seafoods of Alaska, Inc. v. Bissonette) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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